In our latest edition of Crypto Finance Asia (Access Asia’s Linkedin newsletter covering the latest developments, innovations and investments in Asia’s crypto and blockchain space), we report on Crypto IPO fever.
Following the tremendously successful debut of the USDC crypto stablecoin issuer Circle on the New York Stock Exchange last week, the US-based cryptocurrency exchange Gemini on Friday disclosed it had confidentially filed for a U.S. initial public offering. Several high-profile companies, including those in high-risk sectors such as crypto and financial technology, have launched successful listings in recent weeks, reflecting pent-up demand and renewed vigor in the capital markets. These developments also show the optimism and appetite in the traditional finance space for investments in the crypto sector.
Gemini, which is run by billionaire twins Tyler and Cameron Winklevoss, did not disclose the number of shares and the pricing terms for its planned IPO, while the company said a listing “is expected to occur after the SEC completes its review process, subject to market and other conditions.”
Circle skyrockets
For Circle, its share price reached an all time high on Friday 4 times its initial offering price of $31. Among its top buyers were Cathie Wood’s Ark Invest firm, which purchased 4.48 million shares on Thursday. ARK funded the move by trimming $39,000,000 of Coinbase, $18,500,000 of Robinhood, and $10,400,000 of Block. “By grabbing Circle early, ARK secures direct exposure to that cash flow without holding volatile tokens,” one crypto commentator noted in a Linkedin post.
Bridging the gap between traditional finance and crypto infrastructure
Stablecoins – cryptocurrencies pegged to a fiat currency like the USD or a commodity like Gold – are gaining tremendous traction in traditional finance as they offer a bridge between it and crypto infrastructure, and solve payment problems with ease. In 2024, crypto stablecoins facilitated more than $27.6 trillion in transactions — more than Visa and Mastercard combined.
For Circle, it mints USDC, which is a digital dollar backed one to one by the USD that clears in seconds on public networks. The business earns interest on short term treasuries that back each coin and collects minimal fees every time tokens move (which brings in significant revenue from volume).
“This isn’t crypto hype”
With stablecoins like USDC rapidly capturing marketshare of payments, including cross-border remittances, traditional banks with there jurassic cross border payment solutions (dominated by SWIFT which uses technology from the 1960s) will need to quickly adapt and incorporate blockchain payment solutions into their business in order to stay relevant.
As the founder and CEO of the blockchain firm 51 Group, Marc Baumann, posted on his Linkedin:
“This isn’t crypto hype.
If you’re running ops, treasury, or payments infra, you can now use stablecoins
– faster and cheaper.
For the US, stablecoins are turning into a geopolitical weapon to export the dollar.
And consumers can now pay with stablecoins, everywhere.
The financial stack is being rebuilt. Quietly. Globally.”